A new pick and mix home insurance policy that would enable homeowners take out only the cover that suits their needs has been launched by Lloyds TSB.

The bank launched the policy at the weekend, which was necessitated by the query of an 80-year-old customer who had had bike cover included in her policy even though her biking days were long spent.

Lloyds Personal Home Plan will have as standard essential cover for fire, flood and subsidence. And this will be followed by a combination of 21 pick and mix options.

Under this plan customers will only have to pay for the basic cover and extras they add on, which is much cheaper than the fully comprehensive policy.

To further help consumers save cost by up to 50 per cent, the bank is offering no claims discounts. This is only effective if one has not made any home insurance claim in the last 10 years.

The offer is open to anyone, although it is more targeted at the over-55s.